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An economist's perspective: comparison shopping for college education

March 10, 2014

By Dr. Pete Crabb

Comparison shopping—consumers do it all the time.

With today’s technology we can even comparison shop while we are walking through the store aisle. Using our phones we can find the best price and place an order from one retailer while examining the product under the roof of another.

Comparison shopping for college is more difficult. How is the consumer supposed to know they are paying the right price and getting the best value?

“Shopping” for a college education may be difficult, but students and parents who do their homework will quickly learn that Christian higher education is both valuable and reasonably priced.

A college degree has tremendous economic value in itself. The United States Bureau of Labor Statistics reports that average hourly wage in the country is now around $20 per hour. But if you split the group up between college and high school graduates the difference is almost $14. College grads earn about $30 per hour and those with only a high school diploma around $16.

Perhaps more importantly, college graduates are more likely to keep their jobs, even in a weak economy. Today’s unemployment for college graduates is around 4 percent, compared to nearly 8 percent for HS diploma-only workers.

Together, these statistics show a good return on an investment in higher education. But the statistics don’t measure all that comes with going to college. To get at the bigger picture of decisions like this one, economists use a concept called “opportunity costs,” defined as the value of the best alternative foregone. This measure of an action or decision takes into account both explicit and implicit costs.

When comparing colleges all consumers, both parents and students, must consider the opportunity cost of attending a secular institution over a Christian school. Today’s student is going to spend four or five years at their chosen institution of higher learning. The costs of attending include more than just tuition, room and board. Even though the tuition at a state-run, secular institution may be much lower, the opportunity costs may greatly exceed any difference in sticker price.

Opportunity costs can’t always be measured directly like the hourly wage differences mentioned above. Rather, we have to ask questions like: what are the costs of listening to secular worldviews in the classroom or elsewhere on campus? What are the costs of spending so much time with those who don’t share your faith? What are the costs of limiting your expression of faith to certain clubs or only in certain places on campus?

Furthermore, college students learn much more than just job skills. They learn moral principles and develop critical thinking skills. What are the costs of learning only humanistic moral principles? What are the costs of learning to think critically, but not to think critically about other faiths and philosophies?

A Christian college educates the student in how to use their faith in all they do—at work, at rest and at play. The long-run cost of a college education that doesn’t have such values and principles could be very high.

Comparison shop, and use your smartphone as much as possible. But don’t forget all the costs of going to college.